Philippa Fawcett College 24th April 1975
Speakers: E. Hardy, SPGB, v Sir Keith Joseph, Conservative
Subject: THE CASE FOR CAPITALISM
The Philippa Fawcett is a teachers' training college. The debate was held during the afternoon and was attended by about 250 people, mainly students. Two south London newspapers and The Times had reporters and photographers present, but only the briefest of reports appeared. The following précis is from a tape recording.
Each speaker made a twenty-minute contribution. This was followed by a period for questions, to which both speakers were invited to reply. There was a final winding-up of five minutes for each speaker. The debate was attentively listened to and fairly conducted throughout.
Sir K. Joseph
Sir Keith Joseph spoke first. He devoted the first minutes to reading a statement to the press, condemning the proposal of Wedgwood Benn to use pension funds for investment purposes. Turning then to the subject of the debate he continued as follows:
There are broadly three different forms of organizing society. One, the mutual-agreement family arrangement suitable to a Kibbutz size community, but not relevant to a nation of 55 million people. Two, the Market system in which goods and services are produced and supplied according to demand by the price mechanism and profit and loss. Profit within the law under competition. Profit is a signal mechanism for moving men, women and resources from goods and services that are not required to goods and services that are required.
Three, the Command system where goods and services are laid down by a central bureaucracy. Mr. Hardy is as much against the Command mechanism as I. He is in favour of the first mechanism. The question before us is, which system provides the best guarantee of prosperity, freedom, choice and humanity. The optimum combination of all four?
In a small system of simple needs, perhaps a mass meeting could make its decisions. This could not apply to a society of 55 million people. The simple life would rule out such things as anaesthetics. How do producers decide what people want to use?
The Central Committee in a Command Society cannot make decisions that satisfy people. Are we going to spend more money on fighting pollution, for example?
The Market system is based on the proposition you only make a profit if you make and sell what people want. If you don not make what people want, you do not make a profit. This means widespread decision-making, decentralized control spread among thousands of small, medium and large firms. Central government lays down the laws for everyone in the Market system, regulates the degree of pollution.
It is perfectly compatible with humane society. Inventor, critic, reformer, writer, artist — five most crucial people — are free within the market economy.
Marx has changed history more than any individual in the past hundred and fifty years. He was supported by Engels, a Manchester business man.
How do we justify the vast profits of property? Somebody had to take the risk. The only justification for profit is risk.
Civil servants' decisions do not have to be right, they do not stand to lose. The Market system leaves decision-making to those who stand to gain if the decision is right and stand to lose if the decision is wrong. Look at Switzerland: we could be as prosperous and humane.
E. Hardy
The chairman then announced the next speaker, E. Hardy for the SPGB.
He began by drawing attention to the fact that the Market economy as described does not behave as planned.
We must remind you what capitalism is. Wealth is produced by the working class who keep society going, but they do not own the means of production, they do not own the wealth they produce. When no profit can be made, capitalism curtails production. Workers become unemployed. The normal phases of capitalism are expansion, boom, stagnation and crisis. There were twelve crises during the nineteenth century, including a crisis lasting nearly twenty years towards the end of the century.
When there is a crisis it does not mean that capitalism has gone wrong; capitalism has always behaved like this. The Conservatives have been protectionists and then free traders and turned back to protection again. In recent years they have gone in for all the variations of income policy. None of it makes any difference. Nothing can be done about it; capitalism is always the same.
There had been a growing recognition that perhaps Marx was right. Then in the years between the wars a blight fell on the world. Its name was Keynes: an undiluted tragedy from the standpoint of the working class.
Tories, Liberals and the Labour Party all believed in Keynes. Keynes said Marx was wrong. Capitalism can be controlled. You can have full employment, no more crises or wars.
The Market economy is unregenerate capitalism given a new name. They have not got capitalism under control. They have not solved unemployment. We are now in a crisis. They should go back and recognize Marx was right. Keynes was wrong. All past policies including incomes policies have failed.
The SPGB never supported nationalization, which is state capitalism. Private or state makes no difference. We are Marxist. Marx's conception of Socialism is a society where you do not have a wages system. There would no prices or profits. Production would be solely for use, and free access on a world scale. People will co-operate to produce and take out of what is produced that which they need. You cannot do anything with capitalism. It creates class conflict, industrial strife, and war. You must look for an alternative.
What is there to prevent the world becoming Socialist? What obstacle? People won't cooperate? — why can people on a large scale not cooperate?
E. Hardy put a question to Sir Keith Joseph: Do you feel incapable of co-operating for your own advantage? Sir Keith he did feel incapable. E. Hardy continued. What has Benn got to do with Marxism? Nothing. He does not claim to be a Marxist. Sir Keith had claimed the contest in the world was between Marxism and democracy. We are the only democratic party in this country.
The Tory Party has a long list of nationalization projects in its history. Rolls Royce, UCS, Post, Telegraphs, BBC, London Passenger Transport, Harland and Wolff. When Benn nationalized Court Line, he gleefully reminded the Tories it was done under an act passed by a Tory government. Nationalization has nothing to do with Socialism.
Heath had said "no rescue for lame ducks". Mrs. Thatcher advocated rescue on a temporary basis — like going in for drug addiction on a temporary basis. We do not say civil servants can run capitalism better than the whiz-kids. Nothing can be done with capitalism; if you will not go in for Socialism, you will be stuck with capitalism. It will be the same in the future as it always has been in the past.
Questions from the floor
The chairman invited questions.
Q. Under the market economy why are goods destroyed if they cannot be sold at a profit? Education is the first to be hit in a crisis.
A. Sir Keith Joseph.
Surplus food in America rescued Russia, Many poor countries neglect their own agriculture. We have crippled capitalism in this country. Negative income tax is needed to bring people to a minimum level of income to be able to buy what they need.
A. E. Hardy.
Capitalism has never produced enough for the people of the world. Capitalism has enormously increased potential. The largest industry under capitalism is the killing industry. Socialism will get rid of the killing industry.
Q. How does capitalism cause war?
A. E. Hardy.
Looking for markets. Stalin said it was necessary for Russian industry to find outside markets. Nigeria — oil discoveries were the main factor in sparking the civil war. All capitalist powers are expansionists. The bigger ones are simply stronger than the smaller ones. Capitalism and war are inseparable. Socialism will have no market economy. Capitalism not only destroys world resources in wartime, it also destroys them in peacetime. Russia and China behave like capitalist powers threatening each other with armed forces, because they are capitalist powers.
A. Sir Keith Joseph.
The war between Arab and Jew had nothing to do with capitalism. It was a war about national and ethnic identities, and possession of territories. Mr. Hardy had no world to defend.
Summing up
The chairman asked each speaker to make a brief closing statement.
Sir Keith Joseph.
How simple it is to argue for a system that is purely emotional. Mr. Hardy is arguing for pie in the sky. You cannot get all people in the world to agree. Marx left no room for the owner, who is part of the productive mechanism, because of his willingness to take risks to ensure supply in the Market system. The investment occurs to give people what they need.
E. Hardy.
Sir Keith Joseph has to defend the shocking system of capitalism. Capitalism was only a notion when it began. All the reformers have tried to be practical and improve capitalism. They have solved nothing. The utopians are the ones who think they can do something with capitalism. You can't, you have to go in for Socialism.
This is an abridged report of the debate. You can hear the tape recording of the debate at the following link.
Each speaker made a twenty-minute contribution. This was followed by a period for questions, to which both speakers were invited to reply. There was a final winding-up of five minutes for each speaker. The debate was attentively listened to and fairly conducted throughout.
Sir K. Joseph
Sir Keith Joseph spoke first. He devoted the first minutes to reading a statement to the press, condemning the proposal of Wedgwood Benn to use pension funds for investment purposes. Turning then to the subject of the debate he continued as follows:
There are broadly three different forms of organizing society. One, the mutual-agreement family arrangement suitable to a Kibbutz size community, but not relevant to a nation of 55 million people. Two, the Market system in which goods and services are produced and supplied according to demand by the price mechanism and profit and loss. Profit within the law under competition. Profit is a signal mechanism for moving men, women and resources from goods and services that are not required to goods and services that are required.
Three, the Command system where goods and services are laid down by a central bureaucracy. Mr. Hardy is as much against the Command mechanism as I. He is in favour of the first mechanism. The question before us is, which system provides the best guarantee of prosperity, freedom, choice and humanity. The optimum combination of all four?
In a small system of simple needs, perhaps a mass meeting could make its decisions. This could not apply to a society of 55 million people. The simple life would rule out such things as anaesthetics. How do producers decide what people want to use?
The Central Committee in a Command Society cannot make decisions that satisfy people. Are we going to spend more money on fighting pollution, for example?
The Market system is based on the proposition you only make a profit if you make and sell what people want. If you don not make what people want, you do not make a profit. This means widespread decision-making, decentralized control spread among thousands of small, medium and large firms. Central government lays down the laws for everyone in the Market system, regulates the degree of pollution.
It is perfectly compatible with humane society. Inventor, critic, reformer, writer, artist — five most crucial people — are free within the market economy.
Marx has changed history more than any individual in the past hundred and fifty years. He was supported by Engels, a Manchester business man.
How do we justify the vast profits of property? Somebody had to take the risk. The only justification for profit is risk.
Civil servants' decisions do not have to be right, they do not stand to lose. The Market system leaves decision-making to those who stand to gain if the decision is right and stand to lose if the decision is wrong. Look at Switzerland: we could be as prosperous and humane.
E. Hardy
The chairman then announced the next speaker, E. Hardy for the SPGB.
He began by drawing attention to the fact that the Market economy as described does not behave as planned.
We must remind you what capitalism is. Wealth is produced by the working class who keep society going, but they do not own the means of production, they do not own the wealth they produce. When no profit can be made, capitalism curtails production. Workers become unemployed. The normal phases of capitalism are expansion, boom, stagnation and crisis. There were twelve crises during the nineteenth century, including a crisis lasting nearly twenty years towards the end of the century.
When there is a crisis it does not mean that capitalism has gone wrong; capitalism has always behaved like this. The Conservatives have been protectionists and then free traders and turned back to protection again. In recent years they have gone in for all the variations of income policy. None of it makes any difference. Nothing can be done about it; capitalism is always the same.
There had been a growing recognition that perhaps Marx was right. Then in the years between the wars a blight fell on the world. Its name was Keynes: an undiluted tragedy from the standpoint of the working class.
Tories, Liberals and the Labour Party all believed in Keynes. Keynes said Marx was wrong. Capitalism can be controlled. You can have full employment, no more crises or wars.
The Market economy is unregenerate capitalism given a new name. They have not got capitalism under control. They have not solved unemployment. We are now in a crisis. They should go back and recognize Marx was right. Keynes was wrong. All past policies including incomes policies have failed.
The SPGB never supported nationalization, which is state capitalism. Private or state makes no difference. We are Marxist. Marx's conception of Socialism is a society where you do not have a wages system. There would no prices or profits. Production would be solely for use, and free access on a world scale. People will co-operate to produce and take out of what is produced that which they need. You cannot do anything with capitalism. It creates class conflict, industrial strife, and war. You must look for an alternative.
What is there to prevent the world becoming Socialist? What obstacle? People won't cooperate? — why can people on a large scale not cooperate?
E. Hardy put a question to Sir Keith Joseph: Do you feel incapable of co-operating for your own advantage? Sir Keith he did feel incapable. E. Hardy continued. What has Benn got to do with Marxism? Nothing. He does not claim to be a Marxist. Sir Keith had claimed the contest in the world was between Marxism and democracy. We are the only democratic party in this country.
The Tory Party has a long list of nationalization projects in its history. Rolls Royce, UCS, Post, Telegraphs, BBC, London Passenger Transport, Harland and Wolff. When Benn nationalized Court Line, he gleefully reminded the Tories it was done under an act passed by a Tory government. Nationalization has nothing to do with Socialism.
Heath had said "no rescue for lame ducks". Mrs. Thatcher advocated rescue on a temporary basis — like going in for drug addiction on a temporary basis. We do not say civil servants can run capitalism better than the whiz-kids. Nothing can be done with capitalism; if you will not go in for Socialism, you will be stuck with capitalism. It will be the same in the future as it always has been in the past.
Questions from the floor
The chairman invited questions.
Q. Under the market economy why are goods destroyed if they cannot be sold at a profit? Education is the first to be hit in a crisis.
A. Sir Keith Joseph.
Surplus food in America rescued Russia, Many poor countries neglect their own agriculture. We have crippled capitalism in this country. Negative income tax is needed to bring people to a minimum level of income to be able to buy what they need.
A. E. Hardy.
Capitalism has never produced enough for the people of the world. Capitalism has enormously increased potential. The largest industry under capitalism is the killing industry. Socialism will get rid of the killing industry.
Q. How does capitalism cause war?
A. E. Hardy.
Looking for markets. Stalin said it was necessary for Russian industry to find outside markets. Nigeria — oil discoveries were the main factor in sparking the civil war. All capitalist powers are expansionists. The bigger ones are simply stronger than the smaller ones. Capitalism and war are inseparable. Socialism will have no market economy. Capitalism not only destroys world resources in wartime, it also destroys them in peacetime. Russia and China behave like capitalist powers threatening each other with armed forces, because they are capitalist powers.
A. Sir Keith Joseph.
The war between Arab and Jew had nothing to do with capitalism. It was a war about national and ethnic identities, and possession of territories. Mr. Hardy had no world to defend.
Summing up
The chairman asked each speaker to make a brief closing statement.
Sir Keith Joseph.
How simple it is to argue for a system that is purely emotional. Mr. Hardy is arguing for pie in the sky. You cannot get all people in the world to agree. Marx left no room for the owner, who is part of the productive mechanism, because of his willingness to take risks to ensure supply in the Market system. The investment occurs to give people what they need.
E. Hardy.
Sir Keith Joseph has to defend the shocking system of capitalism. Capitalism was only a notion when it began. All the reformers have tried to be practical and improve capitalism. They have solved nothing. The utopians are the ones who think they can do something with capitalism. You can't, you have to go in for Socialism.
H.B.
This is an abridged report of the debate. You can hear the tape recording of the debate at the following link.
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